Interferon-alpha (IFN-alpha) is currently the primary choice of treatment for chronic viral hepatitis, however, more than 60% of patients respond poorly and heavy drinkers do not respond. Our laboratory is focusing on the host factors that are involved in suppression of IFN signaling and resistance to therapy. We have previously demonstrated that IFN-alpha signaling in the liver is suppressed by multiple host factors, including IL-1, IL-10, TNF-alpha and alcohol drinking. In this year, we have identified that another host factor, IFN-gamma, is also involved in resistance to IFN therapy. We demonstrate that IFN-gamma suppresses IFN-alpha signaling and induces expression of STAT1 in the liver. Overexpression of STAT1 attenuates IFN-alpha signaling in hepatocytes. Furthermore, expression of IFN-alpha signaling components and antiviral proteins in the liver are decreased in chronic alcoholic liver disease. Taken together, our findings suggest that multiple host factors including alcohol contribute to the resistance to IFN-alpha therapy in chronic hepatitis C patients.